Retail investors plan to up investments as stock market optimism grows

Alex Sword


The Financial Services Forum

After a year of holding onto cash, many investors are expecting to invest more next year, according to a new survey.

The Modern Investor Pulse from Finimize and IG surveyed 2373 retail investors, finding that over 50% had held back on investing in favour of cash in 2023. 53% of investors plan to increase their cash position in 2024.

As the end of the year approaches, 40% of respondents said they plan to invest more in the next three months as optimism over interest rates and the stock market grow.

Seventy-eight percent of respondents believe interest rates will decrease or stay stable while 73% predict the stock market will be up in 12 months.

In terms of where they plan to invest, tech stocks remained popular with Microsoft and Apple cited by 36% and 34% respectively. However, while the majority of retail investors expected the cryptocurrency bitcoin to rise, only 23% were making plans to invest in it.

Carl Hazeley, chief analyst at Finimize said: “With the US having defied expectations by avoiding a recession in 2023 and forecasts for stable or even central bank interest rate cuts in 2024, optimism about global stock markets is to be expected. Of course, geopolitical tensions and elections in the year ahead have the potential to throw a spanner in the works as well as create opportunities for investors.”

Max Rofagha, Founder & CEO of Finimize said: “The latest data from our community illustrates that retail investors represent an untapped pool of capital. This year has been notable for its instability and we’ve seen experienced retail investors taking a more cautious approach to their investments, keeping hold of surplus cash. However what we can see is that when the market stabilises they’re planning to invest more.”

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